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FG to Sell Four State-owned Refineries Next Year


News » Politics
Nigeria

IMAGE: New refineries »

Nov.19.2013

 

The federal government of Nigeria, Africa’s largest oil producer plans to begin privatizing its four state-owned oil refineries before the end of the first quarter of next year, the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke has said.

Alison-Madueke said in an interview with Bloomberg TV Africa in London, “We would like to see major infrastructural entities, such as refineries moving out of governmental hands into the private sector.

Speaking further, she said: “Government does not want to be in the business of running major infrastructural entities and we haven’t done a very good job at it over the years.”

A presidential audit of the facilities led by a former Minister of Finance, Kalu Idika Kalu, had last year recommended the sale of the refineries due to inadequate government funding and “sub-optimal performance.”

The refineries, which have a combined capacity of 445,000 barrel-a-day capacity, should be privatized within 18 months, according to the report submitted to President Goodluck Jonathan in November 2012.
 

Nigeria, a member of the Organisation of Petroleum Exporting Countries (OPEC), produced 1.99 million barrels per day (bpd) of crude in October, as compiled by Bloomberg show.

The refineries are 124,00bpd Warri Refinery, 60,000bpd Old Port Harcourt refinery, 150,000bpd new Port Harcourt refinery and 110,000bpd Kaduna refinery.

Towards the end of former President Obasanjo’s administration in 2007, the refineries were sold to companies owned by billionaire Aliko Dangote and Femi Otedola.

This previous attempt in 2007 by the Olusegun Obasanjo administration to sell the Kaduna and Warri refineries was reversed by the next government headed by the late Umaru Musa Yar'Adua that took over from the Obasanjo’s administration.

 While Nigeria is also Africa’s top crude exporter and the most populous with more than 160 million people, it relies on fuel imports to meet more than 70 per cent of its needs.

Its state-owned plants operate at a fraction of their capacity because of poor maintenance and aging equipment. The West African nation  including Nigeria also exchanges 60,000 barrel of crude for products with Trafigura Beheer BV and a similar amount with Societe Ivoirienne de Raffinage’s refinery in Cote d' Ivoire, according to Nigerian National Petroleum Corporation (NNPC).


“We are right now undergoing a major turnaround maintenance programme of the refineries,” Alison-Madueke said.

Improvements to the two-unit, 210,000-bpd Port Harcourt refinery, the country’s biggest, would be completed by the end of the year, to be followed by enhancements at the Warri and Kaduna sites in 2014, according to the NNPC.

Warri has a processing capacity of 125,000 bpd and Kaduna, 110,000 bpd.

 

Article Credit: ThisDay Newspaper, Vangurd Newspaper, Chuwu-Anih Ekpere

Updated 5 Years ago
 

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